The account on which overdraft facility is allowed by bank is called a ___________.

Savings account

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Demat account

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Current account

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Fixed deposit account

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Solution

The correct option is C Current account
Current accounts are those accounts which are opened for the purpose of regular business transaction. This type of account is more suited for users like firms, companies, business organisation etc. Bank gives many facilities to current account holder, one such facility is overdraft facility. Bank overdraft means deficit in a bank account caused by drawing more money than what the account holds. This facility is given on current accounts only.

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Which of the above statement(s) is/ are incorrect?

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